Siemens To Reduce Its US Wind Energy Taskforce By 38% Over Concerns About Federal Tax Credit

Wind turbine producer Siemens has announced that it will reduce its US wind energy workforce by 38% due to adverse market conditions caused by the uncertain future of the wind energy tax credit, price competition from natural gas and sluggish growth in electricity demand. The company said the cutbacks were necessary until market demand for turbines revives. Recent estimates suggest that while US turbine installations could reach 12GW this year, the figure could plunge to between 1.5GW and 3GW in 2013, as developers freeze projects depending on Congress’ willingness to extend the federal production tax credit (PTC).

In a statement, the German-based company said: “We have worked very hard to manage the consequences of the market conditions, all of which are beyond our control and are affecting the entire wind power industry. Now, we have had to make the difficult decision to adjust the manufacturing, projects and administrative support functions of our wind power operations to reflect the current and projected business volume. This will affect approximately 615 of our workforce in our wind power business.”

The move will affect 615 workers as follows: 407 at a rotor blade plant in Fort Madison, Iowa; 146 at a nacelle plant in Hutchinson, Kansas; and 62 more in Orlando, Florida. After the move is completed, about 220 workers will remain in the Iowa facility, 152 in Kansas and 150 in Florida.

The federal PTC, which is set to expire on 31 December, will not be renewed if Mitt Romney wins the election as he has stated on several occasions, but speaking to Recharge, Kansas Governor Sam Brownback said: “I have been and will remain a strong advocate for the wind industry. While the federal government struggles with its effort to create a balanced energy policy, my administration will do everything we can to support the industry at the state level moving forward. – and to assist those Kansans affected by this announcement.”